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How to Avoid Classical Mistakes

15/07/2013 Editor

Trading is about being profitable on a constant basis, on the long run, and this is virtually impossible without proper money management techniques. This is a valid principle regardless what one is trading, be it stocks, currencies, or binary options.

In the case of binary options try to avoid classical mistakes like the now famous Martingale system which can put you through lots of pain as the outcome relies basically more on luck than on your trading skills.

Another important money management advice is to try to trade as much as possible on the technical grounds, when you have the possibility to estimate the expiration date of the option you are trading like is the case with the rising and falling wedges strategy covered on the technical analysis here in this educational series.

Another classical mistake, and this is illustrated in the recording that comes with this chapter is not to duplicate the trade before expiration. Why would you risk the same before expiration instead of keeping that amount for another opportunity the market will give you surely?

If in a winning streak, try to invest smaller and smaller amounts as long as the winning streak is going because a looser will definitely come and you don’t want to pay it back to the market that easy.

Last but not least, take breaks after winning/losing streaks, as no one needs to trade 24/7 and tomorrow is a day too.